Dish TV India Directors Report, Dish TV Reports by Directors
Dish TV India
BSE: 532839|NSE: DISHTV|ISIN: INE836F01026|SECTOR: Media & Entertainment
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Directors Report Year End : Mar '14    « Mar 13
To the Members,
 The Directors are pleased to present the 26th (Twenty Sixth) Annual
 Report and the Audited Financial Statements of the Company for the
 Financial Year ended March 31, 2014.
 The Financial Performance of your Company for the Financial Year ended
 March 31, 2014 is summarized below:
                                            (Rs. / Thousand)
 Particulars                      Year ended       Year ended
                              March 31, 2014     March 31, 2013
 Sales & Services                25,089,803       21,668,050
 Other Income                       660,249          511,952
 Total Income                    25,750,052       22,180,002
 Total Expenses                  26,128,424       23,431,940
 profit/(Loss) before
 Tax & Prior Period
 Item                              (378,372)      (1,251,938)
 Prior Period Item               (1,163,688)          -
 before Tax                      (1,542,060)      (1,251,938)
 Provision for
 Taxation (net)                       -               -
 profit/(Loss) after
 Tax                             (1,542,060)      (1,251,938)
 Exceptional items                    -              594,442
 profit/(Loss) for the
 Year                            (1,542,060)        (657,496)
 Add: Balance
 brought forward                (18,180,416)     (17,522,920)
 Amount available
 for appropriations             (19,722,476)     (18,180,416)
 Appropriations :
 Dividend                           NIL              NIL
 Tax on Dividend                    NIL              NIL
 General Reserve                    NIL              NIL
 Balance Carried
 Forward                        (19,722,476)     (18,180,416)
 Your Directors have not recommended any dividend on the equity shares
 of the Company for the year under review.
 The Financial Year 2013 – 14 was a globally challenging year with the
 economy facing turbulent times and the dollar touching new heights. The
 economic downturn brought challenges to your Company however your
 Company, despite the economic slowdown, continued to grow in all
 aspects. The year under review witnessed increase in all folds
 including gross revenue, gross subscriber base, EBITDA and ARPU.
 Dish TV has pioneered the Direct-to-Home (DTH) distribution space and
 continues to hold the largest registered subscriber base till date. It
 has become synonymous with quality digital entertainment in the
 Country. Ever since inception dishtv has been a thought leader bringing
 new and innovative products and services into the category and setting
 benchmarks for others to follow. Dishtv has built and continues to
 sustain abundant capacity, beaming from 2 (two) different satellites,
 offering the largest bouquet of content with an unmatched 450  channels
 and services. All this packaged at consumer friendly tiers that suit
 diverse consumer needs for content across different genres and
 During the year under review, your Company continued to engage
 subscribers by providing wholesome entertainment experience through
 relevant content, on demand services and the door step service &
 support.  The positive effect of Digitization already initiated in the
 previous years continued to show in parts of 38 cities and your Company
 created new service franchisees to cater to the increased requirements
 of newly digitized homes in the said 38 cities. This provided an edge
 over competition and the benefit of such service infrastructure will
 yield benefit in coming years. The Digital Cable System continued to
 aggressively engage into stiff competition however DTH continues to be
 a favoured choice of the customer. Your Company continued to play the
 role of the leader of the Industry with bringing new and innovative
 products and services into the category and setting benchmarks for
 others to follow.
 Dishtv now offers consumer choice across a wide array of multi-brand
 and multi product portfolio, to suit different consumer segments.
 Continuing the lead the category with largest bouquet of 40 HD
 channels, dishtruHD , India''s frst HD set top box with unlimited
 recording, has built a hi-ARPU base of HD users that provide hi-ARPU
 and better retention too. Dish , the standard defnition recorder that
 allowed Indian consumers to taste the power of pause / play, recording
 features at SD prices, has become a 30% contributor to gross additions
 during the year and attracts quality subscribers into the fold.
 During the year under review, your Company launched a new product under
 the brand name – ZING. The new product is aimed at providing regional
 driven content, covering small towns and rural markets which will
 provide your Company an opportunity to strengthen its presence in these
 The favorable demographic pattern and constant rise in the net
 disposable income is also driving major change in the Media and
 Entertainment Industry. The quality of contents is also improving with
 the increased demand, desire and expectations of the consumers. The
 rise in education level and increased expectations mainly because of
 the access to international media, internet and social networking
 platforms is also driving the Industry. The consumer of today is more
 evolved, tech savvy, broadband oriented and is willing to go places to
 satiate his demand for content.
 In true spirit of a category leader, Dishtv has constantly pioneered
 new products that have set new benchmarks, throughout its journey. This
 year Dish TV forayed into the OTT (Over the Top) space with an online
 TV streaming product christened dishonline.  Stemming from high
 penetration of smart phones and internet, the Indian consumer today, is
 spending increasing time on alternate screens like the laptop, tablet
 and smart phone, away from the conventional TV viewing. A large part of
 this consumption on smaller screens is dominated by viewership of
 content online.  Understanding the new dynamics of evolving consumer
 trends of multi-screen behavior, this product provides live TV, on
 demand movies, catch up TV and video shows at the press of a button on
 an app. Hence dishtv viewers can now access their favorite TV shows on
 the go, on their mobile device and never miss a minute of their loved
 program. This innovative and engaging product was introduced at a small
 top up price of Rs. 60 a month, over and above the base subscription on
 TV, has seen over 4 lac downloads in a short span of time.  The
 dishonline product has a great VAS opportunity to build ARPU.
 The changing consumer attitudes of today''s discerning consumers and
 increase in spending patterns, specially towards embracing new
 technology products, presents an opportunity for adoption of new
 formats such as recorders and hi-defnition. With the downturn in CRTV
 market and the tide shifting to fat panel technology showcases the
 consciousness of consumers with regard to quality of TV viewing. The
 panorama for DTH is brighter than ever before. Clubbed with reduction
 in prices of fat panel televisions, demand for quality television
 provides a very fertile ground for the category.  Therefore, the
 Company sees an upsurge in demand for Hi-Defnition STB sales due to the
 expanding HD universe by consumers actively seeking quality content.
 Opportunities also lie in acquiring quality consumers who make a
 positive difference to the bottom line not only contributing to ARPU
 but also increase brand loyalty.
 Subsidiary in Sri Lanka
 Your Company, upon the approval of Board of Directors, incorporated a
 Joint Venture (''JV'') Company with Satnet (Private) Limited, a Company
 incorporated under the Laws of Sri Lanka, in the name and style of
 ''Dish T V Lanka (Private) Limited'' on April 25, 2012 with a paid-up
 share capital of 1 million Sri Lankan Rupees.  Your Company holds 70%
 of the paid-up share capital and Satnet (Private) Limited holds 30% of
 the paid-up share capital, respectively, in the said JV Company. Dish T
 V Lanka (Private) Limited shall provide DTH services upon receipt of
 the License from the Government of Sri Lanka. The Company has received
 the license from the Telecom Regulatory Commission of Sri Lanka and is
 awaiting the license from Media Ministry of Sri Lanka, post which it
 shall commence the commercial operations.
 Subsidiary in India
 Your Company, upon the approval of Board of Directors and the Members
 of the Company, acquired the entire share capital of Xingmedia
 Distribution Private Limited (''Xingmedia'') on March 24, 2014. The
 principal business of Xingmedia is to provide support services for
 satellite based communication services, management of hard assets like
 Consumer Premises Equipment (CPE) and its installation, after sales
 service, call center & back end support service, value added services
 etc. With the strategy of the Company to focus on core business
 activities, strengthen and expand its operations in this feld, the
 investment in Xingmedia will help the Company to take necessary steps
 in this direction expeditiously and effectively. Your Company holds the
 entire share capital in Xingmedia. Xingmedia shall, post commencement
 of commercial operations, shall also provide various services to Dish
 TV including call center and back end support service.
 Audited Accounts of Subsidiary Companies
 In accordance with the General Circular No. 2 / 2011 dated February 8,
 2011 read with General Circular No. 3 / 2011 dated February 21, 2011
 issued by the Government of India, Ministry of Corporate Affairs, the
 accounts of Subsidiary Companies are not attached to the Annual Audited
 Accounts of the Company. The Board of Directors of the Company at their
 meeting held on May 27, 2014 had opted for not attaching the Financial
 Statements of the subsidiaries. The Company has prepared the Audited
 Consolidated Financial Statements in compliance with applicable
 Accounting Standards and the Listing Agreement that forms part of this
 Annual Report. The Statement pursuant to Section 212 of Companies Act,
 1956, highlighting the summary of the financial performance of our
 subsidiaries is annexed to this Report. The Audited Financial
 Statements and related information of the Subsidiaries will be made
 available to any member, upon request, and shall also be open for
 inspection at the Registered office of the Company.
 As required under the Accounting Standard AS-21 – ''Consolidated
 Financial Statements'', issued by the Institute of Chartered Accountants
 of India (''ICAI'') and applicable provisions of the Listing Agreement
 with the Stock Exchange(s), the Audited Consolidated Financial
 Statements of the Company refecting the Consolidation of the Accounts
 of its subsidiaries to the extent of equity holding in these Companies
 are included in this Annual Report.
 Your Company''s fully paid equity shares continue to be listed and
 traded on BSE Limited (''BSE'') and the National Stock Exchange of India
 Limited (''NSE''). Both these Stock Exchanges have nation-wide terminals
 and hence facilitates the Shareholders / Investors of the Company in
 trading the shares. The Company has paid the annual listing fee for the
 Financial Year 2014-15 to the said Stock Exchanges.
 The Global Depository Receipts (''GDR'') of the Company are listed on the
 Luxembourg Stock Exchange.  The Company has paid the annual listing fee
 to the Luxembourg Stock Exchange.
 Your Company has entered into an agreement with National Securities
 Depository Limited (''NSDL) and Central Depository Services (India)
 Limited (''CDSL''), the Depositories of the Company, for facilitating the
 members to trade in the equity shares of the Company in Dematerialized
 form. The Company has paid the annual custody fees for the Financial
 Year 2014-15 to both the Depositories.
 During the year under review, your Company has issued and allotted
 69,590 equity shares, upon exercise of Stock Option by the Employees /
 Independent Directors of the Company, pursuant to the Employee Stock
 Option Scheme - 2007 (''ESOP - 2007'') of the Company and these shares
 were duly admitted for trading on both the stock exchanges viz NSE and
 During the Financial Year 2008-09, your Company had come up with Rights
 Issue of 518,149,592 equity shares of Rs. 1 each, issued at Rs. 22 per
 share (including premium of Rs. 21 per share), payable in three
 installments. Upon receipt of valid frst and second call money from the
 concerned shareholders, during the year under review, the Company
 converted 170,612 equity shares from Rs. 0.50 each paid up to Rs. 0.75 each
 paid up and 170,733 equity shares from Rs. 0.75 each paid up to Rs. 1 each
 fully paid up.
 Pursuant to the issue of further equity shares under ESOP scheme and
 subsequent to conversion of partly paid equity shares, the paid up
 capital of your Company during the year has increased from Rs.
 1,064,779,289.5 (comprising of 1,064,662,247 fully paid up equity
 shares of Rs. 1 each & 22,314 equity shares of Rs. 1 each paid up Rs. 0.75
 per equity share & 200,614 equity shares of Rs. 1 each, paid up Rs. 0.50
 per equity share) to Rs. 1,064,934,215.75 (comprising of 1,064,902,570
 fully paid up equity shares of Rs. 1 each & 22,193 equity shares of Rs. 1
 each, paid up Rs. 0.75 per equity share & 30,002 equity shares of Rs. 1
 each, paid up Rs. 0.50 per equity share).
 Out of the total Right Issue size of Rs. 113,992.91 Lakhs, the Company
 has received a sum of Rs. 113,986.33 Lakhs towards the share application
 and call money as at March 31, 2014, the details of which has been
 provided under the preceding heading.
 The details of utilization of Rights Issue proceeds are placed before
 the Audit Committee and the Board on a quarterly basis. Further, the
 Company also provides the details of the utilization of Rights Issue
 proceeds to IDBI Bank Limited, the Monitoring Agency of the Company, on
 half yearly basis and furnishes the Monitoring Report to the Stock
 The Board at its meeting held on May 28, 2009 approved to make changes
 in the manner of usage of right issue proceeds. The manner of
 utilization of rights issue proceeds as on March 31, 2014, is as under:
 Particulars                             Amount
                                        (Rs. In Lacs)
 Repayment of loans                      28,421.44
 Repayment of loans received after       24,300.00
 launch of the Rights Issue
 General Corporate Purpose/              19,720.37
 Acquisition of Consumer Premises        26,000.00
 Equipment (CPE)
 Right Issue Expenses                       544.52
 Total                                   98,986.33
 The half yearly Monitoring Reports issued by IDBI Bank Limited, the
 Monitoring Agency of the Company, containing deviation from the
 original proposed expenditure plan and in accordance with the approved
 revised plan was recorded by the Audit Committee and the Board at their
 respective meetings and necessary compliance in this regard had been
 carried out.
 The Global Depository Receipt (''GDR'') Offer of the Company for 117,035
 GDRs at a price of US $ 854.50 per GDR, each GDR representing 1,000
 fully paid equity shares of the Company were fully subscribed by Apollo
 India Private Equity II (Mauritius) Limited.  The underlying shares
 against each of the GDRs were issued in the name of the Depository -
 Deutsche Bank Trust Company Americas. As on March 31, 2014, 85,035 GDRs
 have remained outstanding, the underlying shares of which forms part of
 the existing paid up capital of the Company.
 The manner of utilization of GDR proceeds as on March 31, 2014 is as
 Particulars                                         Amount
                                                  (Rs. In Lacs)
 Acquisition of FA including CPE                    7,669.88
 GDR Issue Expenses                                   344.63
 Advance Against Share Application
 Money given to erstwhile Subsidiary                   56.14
 Repayment of Bank Loans                              755.22
 Operation Expenses including interest
 payment  bank  charges,  exchange
 fuctuation                                        21,819.05
 Less: Interest earned-realized                      (439.94)
 Balance with Non-Scheduled Bank                   25,443.97
 Total                                             55,648.95
 In compliance with the Securities and Exchange Board of India (Employee
 Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines,
 1999, as amended from time to time, your Board had authorized the
 Nomination and Remuneration Committee (formerly ''Remuneration
 Committee'') to administer and implement the Company''s Employees Stock
 Option Scheme (ESOP – 2007) including deciding and reviewing the
 eligibility criteria for grant and /or issuance of stock options to the
 eligible Employees / Independent Directors under the Scheme. Further,
 your Board has also constituted an ESOP Allotment Committee to
 consider, review and allot equity shares to the eligible Employees /
 Independent Directors exercising the stock options under the Employee
 Stock Option Scheme (ESOP – 2007) of the Company.
 During the period under review, the Nomination and Remuneration
 Committee (formerly ''Remuneration Committee'') of the Board granted
 380,650 stock options to the eligible Employees / Independent Directors
 as per the ESOP – 2007 of the Company. The ESOP Allotment Committee of
 the Board, during the year, issued and allotted 69,590 fully paid
 equity shares, upon exercise of the stock options by eligible Employees
 / Independent Directors under the ESOP – 2007.
 Applicable disclosures relating to Employees Stock Options as at March
 31, 2014, pursuant to Clause 12 (Disclosure in the Directors'' Report)
 of the SEBI (Employees'' Stock Option Scheme and Employees'' Stock
 Purchase Scheme) Guidelines, 1999, as amemded from time to time, are
 set out in the Annexure to this Report.
 A certifcate to the effect that the ESOP – 2007 Scheme of the Company
 has been implemented in accordance with the SEBI Guidelines and as per
 the resolution passed by the members of the Company authorizing
 issuance of the said ESOPs, as prescribed under Clause 14 of the said
 Guidelines, has been issued by the Statutory Auditors of the Company.
 The said certifcate shall be available for inspection at the Annual
 General Meeting of the Company and a copy of the same shall be
 available for inspection at the Registered office of the Company.
 During the year under review, your Company has not accepted any
 Deposits under Section 58A and Section 58AA of the Companies Act, 1956
 read with Companies
 (Acceptance of Deposits) Rules, 1975. Pursuant to Clause 32 of the
 Listing Agreement, the particulars of loans / advances given to
 Subsidiary Companies have been disclosed in the Financial Statements of
 the Company.
 Corporate Governance is not just a destination but a journey to
 constantly improve sustainable value creation. Your Company firmly
 believes that maintaining the highest standards of Corporate Governance
 is imperative in its pursuit of leadership in the Direct to Home
 (''DTH'') business. Your Company continues to focus its resources,
 strengths and strategies to achieve its vision of becoming true global
 leader in DTH Industry. Your Company further believes that a sound,
 transparent, ethical and responsible Corporate Governance framework
 essentially emanates from the intrinsic will and passion for good
 governance ingrained in the organization. This is ensured by taking
 ethical business decisions and conducting the business with a firm
 commitment to values, while meeting Shareholders'' expectation. Your
 Company considers it an inherent responsibility to disclose timely and
 accurate information and places high emphasis on best business
 practices and standards of governance.
 Your Company seeks to align and synergize the Corporate Governance
 norms prescribed by various regulatory bodies with a view to adopt best
 governance practices leading to sustained growth of your Company
 embracing the inclusive growth and long term benefits for all its
 Stakeholders and the economy as a whole.  Your Company has been
 constantly reassessing and benchmarking itself with well-established
 Corporate Governance practices.
 The Company is in compliance of all mandatory requirements regarding
 Corporate Governance as stipulated under Clause 49 of the Listing
 Agreement with the Stock Exchange(s). For the fiscal year ending 2014,
 the compliance report is provided in the Corporate Governance section
 of the Annual Report. A certifcate issued by the Statutory Auditors of
 the Company on compliance of the conditions of Corporate Governance
 stipulated in Clause 49 of the Listing Agreement with the Stock
 Exchange(s) forms part of the Corporate Governance Report.
 Management Discussion and Analysis Statement for the year under review
 as provided under Clause 49 of the Listing Agreement with the Stock
 Exchanges is separately attached hereto and forms a part of this Annual
 As part of the Essel Group, your Company has at a unifed and
 centralized level, put in place a Corporate Social Responsibility (CSR)
 policy which is based on a belief that a business cannot succeed in a
 society that fails and therefore it is imperative for business houses,
 to invest in the future by taking part in social-building activities.
 During the year, your Company was voted as the ''Most Attractive DTH
 Brand'' in the TRA''s (Trust Research Advisory) report of ''India''s Most
 Attractive Brand 2013'' and also as the ''Most Trusted Brand'' by Trust
 Research Advisory (TRA) in their report ''Brand Trust Report – 2014''.
 CRISIL, a Credit Rating Agency, has during the year under review
 assigned ''CRISIL A- / Stable (Assigned)'' rating to the New Banking
 Facilities of the Company.
 CARE (Credit Analysis and Research Limited), a Credit Rating Agency has
 revised the rating of Long- Term Bank Facilities of the Company from
 ''CARE BBB (Triple B)'' to ''CARE A- (Single A minus)''.  The revision in
 standalone rating of the Company factors in comfortable debt coverage
 metrics (Total Debt / GCA & Interest coverage ratio), availability of
 large unencumbered deposits (cash) to meet any contingencies and strong
 During the year under review, your Company sought the approval of the
 Shareholders on the following matters, vide Postal Ballot Notice dated
 February 14, 2014.
 - Special Resolution under Section 372A of the Companies Act, 1956 to
 approve making loans / investments or giving guarantee or providing any
 security, for an additional amount of Indian Rupees 30 Crores, the
 aggregate amount of loans / investments / guarantees not exceeding
 Indian Rupees 100 Crores, in Dish T V Lanka (Private) Limited over and
 above the limits prescribed under the said Section.
 - Special Resolution under Section 372A of the Companies Act, 1956 to
 approve making an
 initial investment of upto Indian Rupees 1 lakh for acquiring /
 investing through purchase / transfer, the entire share capital of
 Xingmedia Distribution Private Limited over and above the limits
 prescribed under the said section.
 The said Postal Ballot Notice along with Postal Ballot Form and
 Business Reply Envelopes were duly sent to the Shareholders of your
 Company and your Company also offered E-Voting facility as an alternate
 option for voting by the Shareholders, which enabled them to cast their
 votes electronically, instead of Physical Postal Ballot Form. The
 result on the voting conducted through Postal Ballot process was
 declared on March 24, 2014.
 The procedure prescribed under Section 192A of the Companies Act, 1956
 and notifed applicable provisions of Companies Act, 2013 read with the
 Companies (Passing of the Resolution by Postal Ballot) Rules, 2011 was
 adopted for conducting the Postal Ballot.
 Further, details related to the Postal Ballot procedure adopted, voting
 pattern and result thereof have been provided under the General Meeting
 Section of ''Report on Corporate Governance''.
 In terms of the Articles of Association of the Company and the
 applicable provisions of the Companies Act, 1956, Mr. Mintoo Bhandari,
 Non-Executive Nominee Director is liable to retire by rotation at the
 ensuing Annual General Meeting. Your Board recommends the
 re-appointment of Mr. Mintoo Bhandari, as a Director liable to retire
 by rotation, in terms of the applicable provisions of the Companies
 Act, 2013.
 In terms of provisions of the Companies Act, 2013, the office of the
 Independent Directors shall not be liable to retire by rotation.
 Accordingly, Mr. B. D. Narang, Mr. Arun Duggal, Mr. Lakshmi Chand and
 Mr. Eric Louis Zinterhofer, ''Non-Executive & Independent Directors'' of
 the Company, whose office are liable to retire by rotation, under the
 erstwhile provisions of the Companies Act, 1956 have been proposed to
 be appointed as Independent Directors of the Company whose office would
 not be liable to retire by rotation, in terms of the provisions of
 Section 149, 150 and 152, Schedule IV of the Companies Act, 2013, for a
 term of 3 (three) consecutive years with effect from the conclusion of
 26th Annual General Meeting upto the conclusion of 29th Annual General
 Meeting of the Company to be held in the calendar year 2017.
 The Board has received declarations from all the ''Independent
 Directors'' of the Company confirming that they meet with the criteria of
 Independence, as prescribed under Section 149 of the Companies Act,
 2013. Further, your Board has also evaluated and opined that the
 ''Independent Directors'' of the Company fulfl the conditions specified in
 the Companies Act, 2013 and the rules made thereunder and are
 Independent.  Thus the Board recommends their appointment as
 Independent Directors on the Board of the Company.
 Details of the proposal for the appointment of above Directors is
 mentioned in the Explanatory Statement under Section 102 of the
 Companies Act, 2013 of the Notice of the Annual General Meeting. Brief
 resume and details of Directors proposed to be appointed / re-
 appointed at the ensuing Annual General Meeting are included in the
 Corporate Governance Report.
 The Statutory Auditors B S R & Co. LLP, Chartered Accountants, Gurgaon,
 having Registration No .101248W/ W-100022, have expressed their
 unwillingness to be reappointed as the Statutory Auditor of the
 Company.  The Board, on recommendation of the Audit Committee, has
 proposed to the members, the appointment of Walker Chandiok & Co LLP,
 Chartered Accountants, New Delhi (Firm Registration No.
 001076N/N-500013) as the Statutory Auditor of the Company for a period
 of 3 years, i.e., from the conclusion of 26th Annual General Meeting
 until the conclusion of 29th Annual General Meeting to be held in the
 calendar year 2017 and also to fix their remuneration.
 Your Company has received confirmation from Walker Chandiok & Co LLP,
 Chartered Accountants, New Delhi, to the effect that their appointment,
 if made, will be in accordance with the limits specified under the
 Companies Act, 2013 and that they satisfy the criteria specified in
 Section 141 of the Companies Act, 2013 read with Companies (Audit &
 Auditors) Rules 2014.
 The response to the matter of Emphasis laid down by the Auditors in the
 Audit Report and the Annexure thereto is as under:
 The response to Serial No. 5 (a) of the Auditors report and Serial No.
 (x) of the Anneuxre to the Audit Report - The Company holds a DTH
 license from Government of India and the DTH business necessitates long
 gestation period. Being frst mover, the Company has incurred huge cost
 on establishment and awareness of the product, brand building on a pan
 India basis. The Management is fully seized of the matter and is of the
 view that going concern assumption holds true and that the Company will
 be able to discharge its liabilities in the normal course of business
 since the Company holds sanctioned loan facilities from banks and would
 meet the debt obligations on due dates. The Company also has positive
 operating cash flows and the loss is also reducing gradually.
 The response to Serial No. 5(b) and 5(c) of the Auditors report is- The
 Company has been recognizing the initial activation fee received from
 the subscribers over a period ranging from 3 years to 5 years based on
 the time period and nature of scheme under which the connection of the
 subscriber was activated. However, the cost incurred in procurement,
 installation and activation of the Consumer Premises Equipment (CPE) is
 higher than the amount realized from the subscribers.  To this extent,
 there was a mismatch in the total cost incurred upto the time of
 activation of the connection at the customers end and the initial
 revenue realized by the Company. In order to give a fair representation
 of the transaction & matching the cost leading upto installation, a
 change in revenue recognition policy was adopted by the Management.
 This will result in a true and fair view of the underlying business
 The response to Serial No.(ix)(a) of the Annexure to the Audit Report
 is- The Company has to pay the Entertainment Tax in various states
 individually and the Entertainment Tax regime is ever evolving with
 each state making changes in the Entertainment Tax regime.  The delays
 were on account of procedural issues which have been taken care of and
 the amounts have been subsequently paid to the authorities
 The response to Serial No. (xvii) of the Annexure to the Audit Report
 is - The Company needs to procure CPE for installation at the end of
 subscriber. The same is treated as Fixed asset and depreciated over a
 period of 5 years. The funds borrowed for this purpose is relatively of
 shorter duration and hence prima facie, the short term funds are used
 for long term purpose.
 During the year there was no such recommendation of the Audit Committee
 which was not accepted by the Board.
 In compliance with the Companies (Cost Audit Report) Rules, 2011 and
 Cost Accounting Records (Telecommunication Industry) Rules, 2011 issued
 by the Central Government, your Company had appointed Chandra Wadhwa &
 Co., Cost Accountants (Membership Number – 6797), as the Cost Auditor
 for the Financial Year 2013-14. The Cost Auditors'' Report for the
 Financial Year 2013-14 will be forwarded to the Central Government on
 or before September 30, 2014.
 Pursuant to Companies (Cost Records and Audit) Rules, 2014 dated June
 30, 2014 issued by the Ministry of Corporate Affairs, there is no
 further requirement of appointment of Cost Auditors for Company
 providing Broadcasting Services and accordingly your Company is from
 now onwards exempt from appointing Cost Auditors.
 Your Company has an effective internal control and risk mitigation
 system, which is constantly assessed and strengthened with new /
 revised standard operating procedures and which ensures that all the
 assets of the Company are safeguarded and protected against any loss
 and that all the transactions are properly authorized and recorded. The
 Company has laid down procedures to inform Audit Committee and Board
 about the risk assessment and mitigation procedures, to ensure that the
 management controls risk through means of a properly Defined framework.
 This internal control systems of your Company ensures that all assets
 are safeguarded and protected against loss from unauthorized use or
 disposition and those transactions are authorized, recorded and
 reported correctly.
 An extensive program of internal audits and management reviews
 supplements the process of internal control.  Properly documented
 policies, guidelines and procedures are laid down for this purpose. The
 internal control system has been designed to ensure that the financial
 and other records are reliable for preparing financial and other
 statements and for maintaining accountability of assets.
 The Company also has an Audit Committee, presently comprising of
 4(four) Non-Executive professionally qualifed Directors, who along with
 Management team, interact with the Statutory Auditors, Internal
 Auditors, Cost Auditors and Auditees in dealing with matters within its
 terms of reference. The Committee inter alia deals with accounting
 matters, Financial Reporting and Internal Controls which also
 periodically reviews the Risk Management Process.
 During the current Financial Year the Companies Act, 1956 has been
 replaced by newly enacted Companies Act, 2013 and became applicable
 from April 1, 2014.
 The Ministry of Corporate Affairs, Government of India vide its
 Circular 08/2014 dated April 4, 2014 notifed that the Financial
 Statements (and documents attached thereto), Auditor''s Report and
 Board''s Report in respect of the financial years that commenced earlier
 than April 1, 2014 shall be governed by the relevant provisions /
 schedules / rules of the Companies Act, 1956. Accordingly, the
 Financial Statements and the Director''s Report has been prepared as per
 the applicable provisions of the Companies Act, 1956.
 Your Company has been regular in keeping pace with the fast changes
 introduced by the Companies Act, 2013 and initiated necessary actions
 accordingly. Some of the important initiatives taken by your Company
 are as under:
 a) Reconstitution of the Board and the Committees thereof;
 b) Revision of the terms of reference of the Board Committees;
 c) Designation of Key Managerial Personnels;
 d) Setting up of Vigil Mechanism;
 e) Constitution of Corporate Social Responsibility Committee;
 f) Recommendation for the Appointment of the Independent Directors, not
 liable to retire by rotation, who satisfy the criteria enumerated in
 Companies Act, 2013;
 g) Providing E-Voting facility to Members to vote on the resolutions of
 General Meeting and Postal Ballot.
 Your Company is in the business of providing Direct-to-Home (''DTH'')
 services. Since the said activity does not involve any manufacturing
 activity, most of the Information required to be provided under Section
 217(1)(e) of the Companies Act, 1956 read with the Companies
 (Disclosure of Particulars in the Report of the Board of Directors)
 Rules, 1988, are not applicable.
 However the information, as applicable, are given hereunder:
 Conservation of Energy:
 Your Company, being a service provider, requires minimal energy
 consumption and every endeavor is made to ensure optimal use of energy,
 avoid wastages and conserve energy as far as possible.
 Technology Absorption:
 In its endeavor to deliver the best to its viewers and business
 partners, your Company is constantly active in harnessing and tapping
 the latest and best technology in the industry.
 Foreign Exchange Earnings and Outgo:
 Particulars of foreign currency earnings and outgo during the year are
 given in Note no. 30, 31 and 32 to the notes to the Accounts forming
 part of the Annual Accounts.
 The Company is committed to nurturing, enhancing and retaining talent
 through superior learning & Organization Development interventions.
 Long term development of human capital and strategic employment of
 retention tools is at the core of your Company''s strategy. Your Company
 believes that its Employees are the most valuable assets and vital for
 the sustained growth of the Company. We at Dish TV, encourage
 innovation, meritocracy and the pursuit of excellence by setting up
 robust recruitment and human resource management policies. The Company
 takes pride in the commitment, competence and dedication shown by its
 employees in all areas of business.
 The Company has a structured induction process at all locations and
 management development programs to upgrade skills of mangers. Objective
 appraisal systems based on Key Result Areas (KRAs) are in place for
 employees of the Company.
 The Management of your Company aims at developing such strategies that
 not only promise attraction of best talent in your Company but also
 ensures their retention by building trust and instilling devotion in
 the employees at all levels. Your Company aims to incorporate the
 planning and control of manpower resource into the corporate level
 plans so that all resources are used together in the best possible
 As on March 31, 2014, the total numbers of employees on the records of
 the Company were 947.  The information required under Section 217(2A)
 of the Companies Act, 1956 (''Act'') read with the Companies (Particulars
 of Employees) Rules, 1975, as amended from time to time, is required to
 be set out in an annexure to this report. However, in terms of Section
 219(1)(b) of the Act, the Annual Report is being sent to the
 Shareholders excluding the aforesaid annexure.  Any Shareholder
 interested in obtaining copy of the same, may write to the Company
 Secretary at the Corporate office of the Company. None of the employees,
 except Mr. Jawahar Lal Goel, Managing Director, mentioned in the said
 list are related to any Director of the Company.
 In terms of and pursuant to Section 217(2AA) of the Companies Act,
 1956, as amended from time to time, in relation to the Annual Financial
 Statements for the Financial Year 2013-14, your Directors confirm the
 a) That in the preparation of the Financial Statements for the year
 ended March 31, 2014, the applicable Accounting Standards have been
 followed along with proper explanation relating to material departures;
 b) That the Accounting Policies have been selected and applied
 consistently and the judgments and estimates related to the Financial
 Statements have been made on a prudent and reasonable basis, so as to
 give a true and fair view of the state of affairs of the Company as at
 March 31, 2014, and of the profit or loss of the Company for the year
 ended on that date;
 c) That proper and suffcient care has been taken for maintenance of
 adequate accounting records in accordance with the provisions of the
 Companies Act, 1956, for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities; and
 d) That the Annual Accounts for the year ended March 31, 2014 have been
 prepared on a going concern basis.
 The Company maintained healthy, cordial and harmonious industrial
 relations at all levels. The enthusiasm and unstinting efforts of the
 employees have enabled the Company to remain at the leadership position
 in the industry. It has taken various steps to improve productivity
 across the organization.
 Statements in this Report, particularly those which relate to
 Management Discussion and Analysis, describing the Company''s
 objectives, projections, estimates and expectations, may constitute
 ''forward looking statements'' within the meaning of applicable laws and
 regulations and actual results might differ.
 It is our strong belief that caring for our business constituents has
 ensured our success in the past and will do so in future. Your
 Directors acknowledge with sincere gratitude the co-operation and
 assistance extended by the Central and State Governments, the Ministry
 of Information and Broadcasting (''MIB''), the Department of
 Telecommunication (''DOT'') and Foreign Investment Promotion Board
 (''FIPB''), Ministry of Finance, the Telecom Regulatory Authority of
 India (''TRAI''), the Stock Exchanges - and other stakeholders including
 viewers, vendors, bankers, investors, service providers as well as
 other regulatory and government authorities.
 Your Board also takes this opportunity to express its deep gratitude
 for the continued co-operation and support received from its valued
                                  For and on behalf of the Board
                                  Jawahar Lal       Goel B D Narang
                             Managing Director             Director
                                 DIN: 00076462        DIN: 00038052
 Place: Noida
 Date : August 26, 2014
Source : Dion Global Solutions Limited
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